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Harvard Business School’s HBX Online Program Reveals Deeper Debate

Jun 2, 2014

As Harvard Business School (HBS) prepares to debut its new online education program on June 11th, some of its leading professors debate the strategy behind the school’s decision regarding how to respond to the rise of massive open online courses (MOOCs).

A New York Times article yesterday explored the thinking behind HBS’s online platform, HBX, which will attempt to preserve and extend the school’s competitive advantage by creating online courses that, unlike MOOCs, replicate HBS’s distinctive discussion-based case method teaching, but that do not compete with the MBA itself.

Unlike rival schools such as Stanford Graduate School of Business and the University of Pennsylvania’s Wharton School, which have chosen to video their professors teaching courses which they then distribute for free as MOOCs, HBS has developed its HBX platform in an attempt to create a new segment of business education, namely the pre-MBA, according to the Times report.

Since last month, it has admitted several hundred students, mostly undergraduates, into a program called Credential of Readiness, orCORe, that includes online courses in accounting, analytics and economics intended to provide liberal arts students fluency in “the language of business.” Tuition for the courses, which students have nine weeks to complete, is $1,500.

The Times article called HBS’s issue of how to address online education “the school’s biggest strategic decision since 1924,” when it first adopted the case-study method. The approach chosen by HBS Dean Nitin Nohria so far seems to favor the strategy advocated by famed HBS Professor Michael Porter, who has written, “A company must stay the course, even in times of upheaval, while constantly improving and extending its distinctive positioning.” By seeking to replicate the case-study method online while not competing with its own MBA program, HBX does just that.

But, the Times article points out, another famed HBS professor,Clayton Christensen, questions whether the HBX approach will be enough to survive the threat presented to business schools by online education. Christensen recently predicted that half of the United States’ universities could face bankruptcy within 15 years.

As Christensen sees it, the only way for market leaders like HBS to survive “disruptive innovation,” as he has coined it, is by disrupting their existing businesses themselves– much as Stanford and Wharton are doing by making their MBA content available for free via MOOCs.

In some cases, Christensen allows, companies have “survived disruption, but in every case they set up an independent business unit that let people learn how to play ball in the new game,” he told the Times, which HBS hasn’t done. HBX is too closely tied to the business school, Christensen argues.

Nohria and others believe that disruptive innovation may indeed be the demise of second- and third-tier business schools, but that HBS’s brand, network and distinctive case-study method would protect it. “I do not believe our MBA program is at risk,” he told the Times, adding that he doesn’t believe that disruption is always all or nothing. “In the music business, all record stores are gone,” he said, while in retailing, “it’s not like Amazon has eliminated everything; after those debates, my feeling was that we’re going to be more in that category.”

At the same time, HBX – along with its 35 full-time staff members and proprietary platform that provides a live forum that allows a professor to stand in a pit before an audience of digital screens with the live images and voices of geographically dispersed participants – provides a little insurance to the business school in the event that his assumptions prove wrong.